Tool To Hedge Your Risks

By Rontina McCann

Bob Webb (left) reviews the co-op's feed price booking program with Wayne Kirkpatrick (center) and Buddy Peyton.

Salute to Dairymen June is National Dairy Month, a time to honor the farm families who are involved in this vital industry. Southern States is joining in the celebration with Dairy Month specials on many popular dairy products. As a proud partner with dairymen, the co-op provides a variety of quality products for this industry. Southern States applauds the role dairy farmers play in supplying a reliable source of wholesome products.

Wayne Kirkpatrick and Buddy Peyton are more than just partners in their operation, K-P Hill Dairy Inc., near Stuart, Va. They're also savvy businessmen with skills honed in studies at Virginia Tech, where they met as roommates 34 years ago.

In some small way, Southern States is a source for some of this success. That's because the partners use the co-op's feed-booking program as a vital tool in their business. They say budgeting for their business, which includes 372 acres and 165 Holsteins, is one of their biggest challenges because of ever-changing prices.

They rely on the feed-booking program at their local Southern States retailer, Carroll County Co-op at Hillsville, Va.

Bob Webb, feed, farm and home technical representative for Southern States, works with the partners on their feed bookings. "After farmers decide to book feed, they know what their largest expense item will cost them for the length of the booking period," says Webb.

"Locking in feed prices is a risk-management tool that Buddy and Wayne use with great success," he adds.

Having their largest input costs locked in ahead of time eliminates the stress of not being able to predict fluctuations in feed prices.

According to Kirkpatrick, the feed-booking program is a money-saver for their operation. "Right now, for example, feed prices are much higher than they were last fall when we booked our feed and did our budget," he notes.

"As a result, we are saving $30 to $40 a ton," Peyton explains. "When you're buying several tons a week the savings add up, especially when milk prices are low."

Thanks to Southern States, however, budgeting feed costs is not such a challenge.

Webb says the program is available to all dairymen in the co-op's territory. "It's a tool all dairymen should consider," he notes. "Controlling prices is always one of an operator's biggest challenges."

For information on feed bookings, contact your Southern States feed sales and technical representative.